Main Street in downtown Whitehorse. Photo Courtesy of Macklen Linke/CKRW.
Whitehorse, YT – The GST tax holiday, which ends tomorrow, didn’t quite spark a surge in consumer spending with recent data actually showing the opposite in the territories.
From December 14th, when the GST started, to January 15th, total spending in the territories dropped seven percent compared to last year according to financial technology company Moneris. Transaction count and size in the territories dropped by 3 percent and 4 percent respectively. Across Canada, overall spending was down by four percent.
Sean McCormick, Moneris Director of Business Development, states in an email that the drop in spending is due to numerous factors.
“The drop in transaction volume and count indicates that the tax break’s modest savings didn’t seem to appeal to consumers,” said McCormick. “Its short two-month window likely further curbed the opportunity for consumers to plan and make meaningful purchases.”
Broader economic factors including post-holiday budget tightening likely contributed to sales declines.
The Whitehorse Chamber of Commerce (WCC) raised concerns about the program’s rushed implementation in December. Some retailers faced confusion over which products were exempt and they had limited time to adjust sales systems.
